A Systematic Review on Recent Trends of Digital Financial Inclusion

Digitalization and related processes have become prevalent in the last few years. In this chapter, we have examined and discussed the main aspects of digital transformation, their impact on the financial sector, challenges faced and scope of digital finance etc. Financial technology has become increasingly prominent in financial markets in recent years, though this cannot be attributed to the competence of regulators and policymakers as to this call. Fintech can, however, demonstrate its importance as a tool and strategy for achieving inclusive development by attesting to what it has already achieved in the realm of financial inclusion and disruption of traditional market structures. It is now much easier to have basic financial services in India, due to the vast adoption of digital payment systems.

The FinTech ecosystem in India has been aided by a number of factors like the growing availability of smartphones, increased internet access, demonetization and Covid outbreak. The financial industry is full of new innovations that can be applied in a variety of ways to the fields of artificial intelligence and block chain. They all aim to satisfy ever-evolving customer needs generated by the digital revolution. There is also a discussion of the obvious positive advantages of the application of the latest technological solutions. Payment systems facilitate entrepreneurs to easily and affordably connect with their banks, employees, suppliers, and new markets for their services. Reduced travel time and costs can speed up the process of registering and paying for business licenses and permits using these systems. While the situation is improving, entrepreneurs and employees still face challenges due to a lack of banks, digital devices, and reliable technology infrastructure.

As a result of technological advancement, today’s underground economy can provide a favourable breeding ground for hiding a broad range of illegal activities which include cyber threats like phishing, ransomware fraud, and tax evasion. The financial sector is constantly innovating. The industry today places significant emphasis on transaction speed, along with security. The process begins with clients who demand immediate payment transactions and ends up with large corporate trade transactions where time and transparency of the action become core requirements. The digital advancement and financial literacy will help customers find smarter and better ways to save, borrow, invest, and make payments. With consumers becoming savvier, there will be an intense new battle between incumbents and challengers to become their trusted interface.